Harmony in housing: Aligning supply, planning, and infrastructure for community wellbeing

Posted March 12, 2024

  • Local government
  • State government
SGS Economics and Planning NSW Housing2

The housing crisis in New South Wales and Australia requires more than addressing the shortage of houses by just building homes. Strategic planning and infrastructure investment are vital for improving community wellbeing.

The housing crisis has sparked significant reforms at both Commonwealth and State levels, aiming to boost housing supply. While addressing this pressing issue is vital, improving the quality of life in our communities is equally important. This means we must plan properly and invest significantly in essential infrastructure while also building new homes. The planning system plays a key role in making this happen.

Recent reforms in NSW

The National Housing Accord has identified a target for over 370,000 new dwellings in NSW by 2029. Reforms concerning housing supply that have been introduced or proposed since 2023 include:

Transport Oriented Development Program:

  • Establishing eight Tier 1 Accelerated Precincts around transport hubs, including State Significant Development pathways for large projects and a requirement that 15 per cent of homes be affordable housing.
  • Establishing 31 Tier 2 locations within 400 metres of a transport hub or town centre allows for flat buildings in all residential zones.

Low and Mid-Rise Reforms:

  • Allowing dual occupancies to be permitted in all R2 Low-Density Residential zones in NSW.
  • Allowing for terraces, townhouses, manor houses, and 2-storey apartment blocks near (within 800 metres of) train stations and key town centres in R2 zones across the Six Cities region.
  • Allowing for mid-rise apartments near train stations and key town centres in R3 Medium-Density zones across the Six Cities region.
  • The introduction of non-refusal standards favouring more permissive controls.

Changes to the Housing State Environmental Planning Policy (SEPP):

  • Introducing a bonus floor space ratio (FSR) scheme allows for height bonuses of up to 30 per cent, where a minimum of 15 per cent of gross floor area (GFA) is affordable housing.

Development of a Pattern Book for medium-density typologies:

  • Intended to facilitate accelerated approval pathways for developers.

Housing supply is only part of the solution

A greater supply of housing in well-located and serviced areas aligns with best practices, and NSW is not alone in introducing these kinds of reforms. However, even in well-located areas, an integrated consideration of the other elements of our cities that need to co-exist alongside increasing housing, rezonings, and increased densities is required to achieve good outcomes.

SGS’s recent work with the Municipal Association of Victoria (MAV) and the Queensland Conservation Council (QCC) has distilled five pillars required for good metropolitan planning. These aim to deliver effective city-scale planning based on a compelling overall vision and net community benefits.

Figure 1: Five Pillars of Metropolitan Planning

SGS Economics and Planning Five Pillars 01

Facilitating housing supply is a crucial part of Pillar 4 – Housing choice, affordability, and sustainable neighbourhoods – however, objectives under the other pillars need to be seen as just as important and given equal attention, including:

  • Planning for development and settlement patterns that respect and minimise impacts on the landscape and its ecological systems (Pillar 1).
  • Allowing sufficient capacity for employment opportunities around centres/clusters (Pillar 2), accessible from where people live and with good transport connections.
  • Sustaining an effective transport network that shapes the land uses that develop around it and provides efficient movement corridors (Pillar 3).
  • Proactively planning and delivering the necessary supporting infrastructure – civil and community infrastructure (Pillar 5).

Importantly, the pillars are interrelated and require strategic planning to be delivered. As the Planning Institute of Australia has outlined in its submission to the NSW Government concerning the changes, the planning system is a crucial element in both delivering housing and meeting the long-term needs of communities. Rezonings and incentives to increase the potential for housing solely will not deliver a greater supply. They also run the risk of inducing negative outcomes in the long term if the housing is not planned for strategically.

Strategic planning is critical to solving the crisis

The current housing crisis results from decades of policy decisions concerning housing at the local, state, and federal levels and a complex interplay of societal factors. It is unrealistic to expect short-term responses, such as rezonings that focus only on establishing the basic platform for a supply-side pipeline, without considering associated infrastructure and amenity investments, let alone wider policy and economic constraints, will ’solve the crisis’.

From a planning perspective, our communities need robust and holistic strategic planning that considers all elements of making our cities and regions liveable. Housing supply is part of the story, but a singular focus on it is insufficient.

Read more about the need for community infrastructure alongside housing development in this LGIU briefing.

Connect with us on LinkedIn

  • Local government
  • State government
SGS Economics and Planning Amanda S Square BW 1
For further information contact:

Amanda Sturgeon


View profile →
SGS Economics and Planning Jo Noesgaard
For further information contact:

Jo Noesgaard

National Lead Local Government | Principal & Partner

View profile →
SGS Economics Planning Pat Fensham
For further information contact:

Patrick Fensham

National Leader for Urban Policy & Governance | Principal & Partner

View profile →